In the wake of the Greece debt crisis French President François Hollande came out in favor of creating a euro-zone government to oversee all 19 countries that use the euro.
His proposal would see the member countries adopt a centralized parliament and stick to an overall budget.
Even though the states have adopted the common currency, each member state is still allowed to conduct their own fiscal and economic policies.
The weakness in this strategy was exposed during the Greek financial crisis when infighting between member states almost led to a serious downturn in the euro currency.
“Circumstances are leading us to accelerate,” Hollande said in an opinion piece published by the Journal du Dimanche on Sunday. “What threatens us is not too much Europe, but a lack of it.”
Hollande would like to see countries in favor form an “avant-garde” so they can move ahead with this strategy. His plan is in homage to his mentor Jacques Delors who was in favor of a similar plan. European Central Bank President Mario Draghi is also onboard, and would like to see the creation of a shared treasury within the next ten years.
Hollande would like to go even further, creating a “new” parliament that would meet in separate sessions where they can have eurozone centric votes and create overarching eurozone laws. He would like to see a distinct eurozone government complete with its own Prime Minister.
“Europe has let its institutions weaken and the 28 European Union member countries are struggling to agree to move ahead,” Hollande said.
However, these ideas may not go over well with European heavyweights like Germany, Ireland, and Great Britain. In the past Germany has opposed the richer euro nations helping the poorer countries. Countries like Ireland that have low business taxes may oppose Hollande’s tax harmonization plan. For their part, Britain may not be entirely opposed but would still like to maintain a looser relationship with the eurozone.
This may not sit well with countries like France and Poland that would like to see Britain agree to remain liable to the supra-national European laws. British Prime Minister David Cameron would likely oppose any legislation that would make Britain look like a second-tier nation in the eyes of the rest of the world.
This course of action will likely set Hollande’s France and supporters in Italy and Spain against Germany and Britain for the future of the eurozone.[Bloomberg][The Independent]